have been a great fan of worldvision. >> i have a written statement but before that i wanted to say thank you. it is great to be part of this. ..art of one of these events before and i'm amazed to see everyone come together and be across panel or however you describe it, to support across the congress. it's great to see people come together in something we do focus on not just the

when navarrette wherever disasters occur. i will not see a few more words about a recommendation. protection is focusing on safety, dignity and rights of people impacted by disaster. the october 2012 guidelines for proposals of the usaid requires that proposals must demonstrate protection mainstream in all sectors of the programs. our potential partners must

integrate throughout their funded programs regardless of sector. it is important for usaid to ensure these guidelines are followed for the start of the program to the end. maximizing integration will maximize protection for specially vulnerable people. it will also minimize difficulties in cost-benefit integration protection retroactively. prior to engaging in collaborating with people impacted by the disaster should be identifying assistance and protection needs and ensuring they are not. they're mean for participation in all stages including assessments, design, implementation and monitoring is essential to the success of the program and can prevent harm. we want to make sure we are not doing programs to people, but programs with people and we want to urge the u.s. government to ensure that it's happening across the board. in disasters, children are often the service because a separation from family, disease and other

threats. there are numerous ways to reduce this risk, including prioritizing opportunities for adults to a living from supporting comprehensive registration of children coupled with symmetries the reunification efforts commensurate children have safe places to play, and recover. monitor an increase in explicit images of filipino online and on sky. restoring schools, increasing training for national police and other security personnel and minimum standards for child protection. strengthening existing formal and informal chat protection mechanisms at the community and local government levels. and finally, prioritizing clean water, proper sanitation, hygiene education to preventing or responding to disease outbreaks. basically what we do together right now is the front-line response. we want to make sure people are safe, people have access to basic services and this continues on through an evolution.

women and girls would potentially be at less risk, especially in evacuation centers of comprehensive plan to improve security for revenue growth is developed and implemented with cooperation of national police and other security services. opportunities for women to earn a living, especially those in households are essential for protections for abuse and exploitation. the context for recommendations include the typhoons disrupting sources of income for over 5.6 million men and women. i read that this morning i didn't realize how many people had lost sources of income. i beg you looking at a million, 2 million people. this morning it was 5.6 million women and children for women and men. it was astounding. the filipino department of health are warning several diseases are becoming huge public health threats as a result of the typhoon. in addition to the health risks, ngos including world vision, multilateral institutions and the ilo have identified the

effect to providences in the philippines as having 3 million children engaged in child labor. when economic opportunities for adults decrease, the health challenges arise in the risk of children abused and exploited often increases. i've can find most of my time to share recommendations in context for them. congressional oversight, this is important for you guys, and engagement is an important part of the response to disasters and although she per transaction. during the question-and-answer period i would be glad to unpack recommendations and give examples. details are written in my written testimony. mr. chairman, thank you for leadership in this opportunity. i welcome questions and those are the numbers that subcommittee. >> mr. bluesky, without objection or full state will be made part of the record. just a few opening questions.

mr. callahan, both of you really, one of the things we noticed from questions are raised here with schools may not open for months. this may be the end of the school year. as you pointed out, schooling not only provides educational challenges to the child, but it also serves as a place for protection. it also can be a way of observing whether or not some ptsd and other problems might be manifesting, which could very well. we met with the man, who is the same man that carried the 3-year-old dead little girl, who just broke down. he said that at night if you really listen, you can hear the cheers of young children who get scared very easily but if there's a thunderstorm or some other, another typhoon. very much on the edge. i think your point, about a

three to five-year recovery, we need to look at that, working with them to make sure there is a broader horizon as to how sustainable recovery efforts would be. if you could elaborate on the ptsd issue. secondly, the risks to relief workers and health teams. one of the usaid leaders but not with told me when we were talking about the fever that he had it. he said i had malaria six times. from our work, my work in africa and elsewhere, so often the case of the health work hours and relief teams or they have experienced many diseases. and with a possibility of an epidemic manifesting very shortly. it does raise questions to their

health concerns as well. not only do they do so much to help others, they themselves become sick. i'll never forget on a visit to comment camp and therefore, mr. saint kitts and i met with the director who were shaking. he had malaria. they said go lay down. we contact to someone else. he says no, it's my job. just an extraordinary, just courage on behalf of others. so i'm worried about the health workers if you could speak to that. the cash for work, how long, mr.laap a i think your point was well taken about the coconut trees. we saw them bent over, broken everywhere we went. they do take five of to seven years to revitalize that industry. what will the people do? are those other vibrant livelihoods? and on the trafficking side, do you think we're doing must have? because i think now is when the

the greatest risk arises. the parish idea, i think, is a good one, i had not heard that, of sharing lists. and finally, on the issue of all of the pregnant women who will need a safe venue to deliver their children, is it time for a blood drive perhaps by the diocese, you know, around the area? of course, it requires a -- [inaudible] but if the be blood is not available, women will die, and it's all unnecessary. it seems to me we need to prioritize that as well. mr. callahan? >> maybe to jump in and first on and appreciate your comment about the risk to the relief workers. one of the things that we're trying to do right away is make sure they have an adequate place to say, so there is a look at trying to get some containers and some spaces for some of the relief workers to stay. we've been very fortunate that people volunteered to be there

during the thanksgiving holiday season, so some people who have been risking themselves and being very generous with their time. we do try to rotate staff in and out and take good care, but many of us appreciate your concern there. you also mentioned in the issue of trafficking are we doing enough, i would say my answer always to that is, no. i don't think you can do enough in the trafficking field. you know, one woman, one child that is missing, and we saw this in haiti, i saw it myself in india when i went to one of the relief sites after earthquakes and supercyclones there where people came up to me and said do you want a child. and so we need to continually do more. i think the fact that this

committee has raised this issue, you've put a spotlight on it, i think, is an opportunity for us to raise the issue. i know ms. steele is very interested in this area, and i think that's something we can highlight once again with her and raise it with the filipino government. i would also say the issue of the children, two things that we've found have been very helpful both this be haiti and in syria, one is child-friendly spaces that you can go and have children that are in areas where they can have safety, where they can play games and all and where they can do things that today feel like children again and feel protected. so that's one area where i think that can help. there is recognition among the church actors that we've talked to already and people in the communities that trauma is the big with issue not only for the children, but for the caregivers, for the clergy that are there. everyone was sitting in this, you know, supercyclone, and we talked to people who were sitting with poles holding up

the walls as the roof was torn away, and someone came to assist them and was whipped by the wind, you know, thrown against walls. so i think the post of traumatic stress -- post-traumatic stress, we have brought people into different countries and syria was the latest where we had interactions and counseling for them, similarly in haiti. and we're trying something out in syria right now with puppet shows for children so that they can express what they've gone through. and children are also very resilient, so if we do this at an early time, hopefully that can be of assistance. i would say lastly with the pregnant be women i think it's a key issue. we saw women there and saw some of the newborn babies that were there. big concern. we did the two and a half hour drive to ormuk which had some generating electricity. i think it is a key issue. as i said, the key is looking at the rebuilding of its institutions, both health

clinics, schools and church, and i think that's a requirety, you know, how do we -- priority, how do we protect these women. it hasn't been solved yet, but we'll continue to raise it. >> kind of have to mirror what you said but on a different front, world vision has seen that it's important to have a front line response with the life saving intervention such as food, water and shell e and we've done that. -- shelter. we have, i believe, it's 18,000 children in friendly spaces, we're planning to scale that up i wallet to say to 40,000. we see that the care through child-friendly spaces helps deal with the trauma, the ptsd. it also helps to keep children safe. but it also helps to convey important messages such as health messaging, water and sanitation messaging, and we've seen this as one of the key he can nhls for the front line of -- he can -- mechanisms for the common line of the response.

secondly, as a survivor of dengy, i actually experienced it, so we understand that. i just remember shaking and bone break fever, it hurts. we have prioritized as an organization staff care. so we've done everything from finding appropriate places to live, of course, insuring at nighttime people have mosquito nets and proper health care. in addition to that, we have a group that we meet with for psychosocial care within our organization just to make sure our staff is mentally okay. we're partnering with the heldington institute, and we meet with -- i call it meeting with the shrink once every week. and it was great just to debrief and make sure that everybody was doing okay. as far as casper work goes, we see it as one of the key front line responses but also helping people to get back on their feet so that, yes, it'll help clean off the streets, the buildings, but we want to make sure it gets

cash in people's pockets so they're able to take other thanship of their lives again -- ownership of their lives again, and we would see this happening for the short to medium-term response. we want people to have cash to start their lives again. and as far as trafficking, i would second my colleague, mr. callahan from crs, add saying, no -- as saying, no. of we're never doing enough on trafficking. for that reason, world vision came with recognition, and -- recommendations, and we'd like usaid to help urge the filipino government and constituents in the u.s. government to push for more child protection programming. because we do see trafficking as a problem now. it was a problem before. we've actually been working in the 23eu8 peens for a long time on child trafficking, child labor. in fact, i just found out before this meeting that responding through community groups we've helped to get over 30,000 children out of underage work. so children who are working in

factories, sweatshops and in places that just, well, they're children. they shouldn't be working. we set up committees, community-based organizations, committees for helping children to get out of that, but at the same time, to identify when chirp are at risk. we're pushing hard for those committees to be alert and to be able to respond. so that's all i have to say. >> you this your testimony, mr. palusky -- >> mr. chairman, i'm here, can i just offer just a word and then i'm -- >> okay. >> just a courtesy. be -- because i just cant to thank you, i won't be here in another hearing, and i just stepped out. thank my colleague for his leadership and the ranking member. i just want to be able to work with the committee and collaborate with some of the committees that i serve on, and i'll just leave these points on the record, and that is the sons of the united states, the national response be that i know part of it was usaid, the

identification of the deceased, the reunification of families this which i know that may have been raised, and i know that each of the diseases have been raised, but specifically raising those questions since the pain of those individuals was clear. and then the continuing support that the united states private sector can give to the philippines be p. i thank you for allowing he to place that on the record, and with that, mr. chairman, i look forward to working with this committee and offer my deepest sympathy to the people of the philippines and yield back. thank you for your court is -- courtesy. >> thank you very much, ms. jackson lee. mr. plus key, you mentioned that two men were arrested for human trafficking as they tried to take a 16-year-old girl onto a flight to manila. it's an issue i've been pushing in europe, the osce, we now have an action plan which i think will be adopted promoting the idea of training flight attenabout thes, bus people,

people on trains to spot a trafficker and notify the appropriate individuals. i mentioned it, we mentioned it several times during our trip to officials. i'm not sure till peen airlines -- philippine airlines has any intention on doing it. nancy resaturday has done yeoman's work as a flight attendant, and she makes the point that, you know, trafficked persons need to be moved somehow. very often internationally. obviously, it's by the airlines. and very often the you have a trained flight attendant or atten2k5b9s who can spot a trafficker and traffic people, the telltale signs, inform the pilot pilot and then when that plane lands, arrest or at least separate and find out whether or not there's a trafficking this progress. she told me that there was a pedophile ring coming out of haiti, and they noticed there

was something wrong. they finally investigated it, and i.c.e. stepped in and law enforcement stepped in and broke up a huge pedophile ring operating under the cover of a terrible natural disaster. where it's been been it is cost-free, situational awareness, and it seems to me we need to say with one collective voice train flight atten cants, train all people. you mentioned earlier in your testimonies about how important it is that the police and others be well aware but this, you know, they have to move these individuals sometime somewhere with, and they usually use some type of public transportation. so if you might want to speak to that. and also -- because, again, i think now is the critical fades when, in a sense, tacloban was hermetically sealed by the typhoon with only the military coming in with c-and -- c-130s and the like, it was difficult for traffickers to bring anyone.

now's the time to move in absolute earnestness to mitigate the possibility of young children, women being trafficked. if you might want to respond. >> first of all, i think it's great that -- to see the initiative taken and just the pushing to help stop trafficking. as far as be different initiatives, this sounds like one of a great many possibilities. so we want to concentrate at a high level with government, we want to concentrate on a different level with corporations, whomever's working. so if people are working, airline organizations, but also for us it's almost more important at the community level. so we want people, you know, your local policemen, your local, i don't know, mom and pop other than, just basically community members to be able to come together and be able to identify when there is the potential of trafficking and to reduce those risks. so we encourage can it, we're very happy to see at the high level and even the medium level and then, of course, at the

lower level where we've been working for a long time that we just want to keep on reenforcing and working in this area because we do see it as an area of high risk. especially now. >> i might just add that i think as you have earlier presented legislation that would have a fund to address this, which i think would be a great opportunity. in the case of leyte, i would think the most vulnerable area would be, as you suggested, the water routes. there was crowds and crowds of people. it would be easy to move people in. they were overloading the ferries at the time. people are sitting on the stairs, ask you hear all these disasters and wondering if you're going to be art of one as you're transferring over. so i do think in these transit points highlighting some individuals that could, you know, pick them out, you know, i would think in some of these cases, particularly post-emergency, it would be with very challenging, but people that can go and fit in. we actually found that in haiti on the border with the dominican

republic, we had a group of sisters that would be there and actually were chasing people across that bridge and stopped people. they had a relationship with the border guards, and if they came and identified something, the boarder guard would not let them pass. and we did not have one case where they approached someone that they weren't trying to transport someone. they then took the child to a safehouse and protected them there, but there are these mafia rings, you know, type of mafia rings that go through there, and i think there is a need to have some civil society along with the officials, border guides, transport officials and others so that there can be a come combination type of effort. >> our hope is, and we did raise in this again with the two cabinet members that we met with, that the philippines would use this as a model themselves to use every best practice imaginable including the training of airline flight atten cants to -- attendants to stop traffickers. because we know they're perched and ready to exploit.

so thank you -- yes. chris? >> like to make one final follow-up to that. >> sure. >> we see it important on the private sector, the local level but also with the police departments and municipal authorities. the training of those different units, different areas we have seen has a huge impact on let's say stagnating or limiting or mitigating to a large effect of trafficking. so we would like to the encourage that even more and especially throughout this response. so it's at all levels. >> you know, i would just point parenthetically, and i think it's important to underscore this, the philippines needs to know we're all in this together with the super bowl coming to new jersey in 2014. governor christie and the attorney general and law enforcement, state lis, homeland security -- police, homeland security at the state level are all working overtime knowing that that venue becomes a magnet for these exploiters of women and children. and so why should we think any,

you know, if it happens in the glare of the super bowl, a typhoon-afflicted area certainly has to be even a greater danger area. so we these to work even more with the philippine leadership so that they will do more to mitigate trafficking. mr. green. >> thank you, mr. chairman. you mentioned earlier -- i believe it was mr. callahan -- that we have three million children who are in child labor. sometimes that's a very polite way of saying something akin to involuntary servitude. i'd like for you to elaborate, if you would, on the conditions that these children are having to work in and say a little bit more about it so that i can get some sense of what we're talking about. also you mentioned the gratefulness of the filipino people. one of the things that i hear as

i move about with reference to our foreign aid is that people are not always thankful, and there seems to be this notion that because they're not thankful enough, perhaps we should do less. and, of course, you and i know that we do it because dr. king was right, life is an inescapable network of vir callty tied to destiny. be what's happening to people in harm's way today can impact us tomorrow. we are all blessed than but for the grace of god, could easily be us. especially those of us who live along the gulf coast. so if you would, talk about the children. and finally if i may, mr. chairman, i'd just like to mention mr. similar kins and i trust i'll proannounce his name correctly, mr. tozi, i just want to mention they were very helpful and very knowledgeable about these issues that we have to deal with and spoke up and

made some great points about the a thurm of things -- a number of things that are important to the people not only of the philippines, but also to us in terms of our ability to message these things that we saw. so i just want to give my expression of appreciation to both of them, and i'll yield back. >> thank you very much, mr. green. people caiment up to us thank us for being there for the assistance. not just whether we were in the airpches but even in an >> people would come up even this an airport. we even had the opportunity, they had a basketball game with two professional teams to try to raise money for this effort. the two teams happened to be the next morning on the same flight we were flying to manila on, and each one of them as they came by

shook our hands and thanked us for being there to assist them. so the recognition was there. everyone we talked to did recognize the work of the united states. i'll mention a comment about the children, then pass it to chris because he was mentioning some of that earlier but with i think your comment about child labor and servitude, it really, you know, for me is a matter of semantics. many cases these children, there's certain industries for child labor that are, quote-unquote, legal for children and others that are illegal. many of us feel that all industries should be illegal for children. but you would have them being in some -- it's one thing if it's a family type of activity, but in cases it does come more to servitude that a family takes a loan, their child's got to help work to pay off the loan, and that continues on. we see that in the philippines, in brazil, in african countries. so the issue of servitude

continues to be a big one for us as well. chris? >> thank you. within the philippines we've seen that there are certain industries that children are involved in child labor. there's different, i mean, you think of the sweatshops, you think of the garment industry. we've seen a lot of corporations with a lot of, well, let's say -- i don't want to say corporations, i'll say companies throughout the country that there is child labor. world vision has a policy where we've been working throughout the country to help eliminate that and, again, it goes down to the local level again. we've been trying to focus on identifying what are these industries and actually even stop people from coming in and exploiting people. and not even on the child traffic or the child labor level, but also on the trafficking level. we've seen people come into the philippines b from the middle east and other areas around the world to get domestic servants. so they use this as an

opportunity. and especially around i'll say times of disaster is when people are desperate for work to come in and say, hey, we have an opportunity for you to work in dubai, for you to work in lebanon. and people are desperate, and they're thinking this is a great opportunity. world vision is working with these local community members and also with, you know, the local municipalities, the police departments to make them aware of maybe these people are legitimate, but please, make sure that they're a legitimate organization and you're not just falling victim to being a trafficking victim. so we will continue to work in this area and will continue to, hopefully be, highlight some of these challenges. especially around domestic servitude that we've seen especially with filipinos. >> just add one point to that. i was recently on a visit to the balkans and cyprus, and we have found that in the middle east we have centers now that some of our local partners have in lebanon are they have somalis, they have sudanese, they have i

have land cans, they have all these people that have been trafficked from other areas including filipinos, and they're if these centers, and there's the attempt to try to reunify them and bring them back home. you know, an ethiopian woman that was in lebanon that we finalgy got back -- finally got back to ethiopia. peez continue to be airs where, obviously, when they're trafficked, it then become be withs into more of a servitude. if they're transported across international lines, once you take their passport, they're afraid they might be arrested then, how did they come here legally, and they're very vulnerable. and you these some type of opportunity, people they can trust that typically in our situation it's gone to local safehouses. they've been be rehabilitated there, and and we try to work with the local embassies. through r but there are these rings that continue to be out there. >> if i could just follow be up and piggyback, i worked in lebanon for two years before, well, coming to the states. and i've seen some of these

programs that crs and world vision are working on together, and you do see people from the philippines, somalia -- not somalia, but ethiopia, different places throughout the world. their passports are taken. if they don't pay back their travel loan, they're not given permission to stay in the country, but they're not given back their passport, so they're arrested. so people sit in jail until they're able to pay back their travel loan or whatever fees that their employer feels that they're owed. and it's a vicious cycle. so we're working with people in the prisons who had been stuck there because they were victims of trafficking, and they weren't able to pay in order to get back home. so we're hoping that, again, we can mitigate some of these things from happening for places like lebanon, for dubai, throughout the middle east and then, actually, globally. >> thank you. >> thank you. is there anything else either of you would like to add before we conclude? >> i would just say that i think

we were off to a good start here, and i appreciate the attention you, mr. chairman and representative green, have brought to this case by going out to the areas. i think as we mentioned before, i would just put that one last emphasis that it's not over. a disaster hasn't disappeared. syria is getting worse and worse. we heard, you know, today 12 sisters were just, you know, kidnapped. we have central african republic. it's important that we don't forget the fill evens and let that country -- philippines and let that country go down. thirteen million people were affected, it really needs a significant three to five year response. and i think the filipino people, i know the filipino church and the government are ready to put their shoulders to the grindstone. i think the we do it in solidarity with them, they can achieve that goal. if we let it go, frankly, shame on us. >> and as we heard in the testimony before ours, i'd like to say, amen. definitely. be it's going to be a marathon.

we always hear, you know, you've got to sprint up there, you've got to respond immediately. yes. with this many people affected, the scale of the disaster, it's going to be a marathon. so i just would encourage, well, the u.s. congress, the u.s. government and anyone you can talk to keep the eye on the long run. thank you. >> thank you very much. and on that note, the hearing's adjourned, and i thank you gentlemen and your organizations for the extraordinarily important work that you do. thank you. hearings adjourned. >> live today on c-span2 treasury secretary jack lew gives an update on the implementation of dodd-frank financial regulations. at 9:30 eastern the house energy and commerce committee hears from members of the federal energy regulatory commission. and later at 1:15 eastern, senator patrick leahy delivers

remarks on civil liberties and national security. unemployment insurance benefits are set to expire on december 28th. today, the democratic steering committee holds a hearing on what that would mean for close to 1.3 million people. you can see it live at 10:30 a.m. eastern on c-span3. >> friday on c-span, "washington journal" looks at the mission and role of the national institutes of health. starting live at 7:30 eastern with director francis collins on their medical research priorities, future projects and the impact of sequestration. at 8, allergy and infectious diseases director anthony fauci followed at 8:30 by eric green, director of the national human genome research institute. at 9, national cancer institute director harold very mis, and at 9:30, director thomas insole,

all with your calls and comments live on c-span. >> as you walk in, there are tables out in front with lots of pamphlets, right? you know, prior to entering the gun show. and the pamphlets are all how the government's trying to take away guns, the government's doing this, and obama's doing that, and obamacare's terrible. so those were the guys i wanted to talk to because they were the guys with the leaflets, the ideas. so i said to them, you know -- [inaudible] and they said who are you, and i said, actually, i'm a researcher, and i'm doing research on these organizations, these ideas and trying to understand the guise about it, and i'm actually studying men who believe stuff. and they, you know, a bunch of them looked at me suspiciously and sort of asked me questions. and i just said, look, here's what i am, you know? i don't get it. so -- but here's my job, i want to understand how you guys see the world. i want to understand your world

view. look, you will not convince me, and i will not convince you. that that's off the table. what is on the table is i want to understand why you think the way you do. >> downward mobility, racial and gender equality, michael kimmel on the fears, anxiety the fews and range of angry white men sunday night at 9 on "after words" part of booktv this weekend on c-span2. randi weingarten, president of the american federation of teachers, spoke wednesday about improving education and the performance of american students in the 2012 international student assessment. you can see all of her remarks at c-span.org. here's some of what she said about test scores. >> today, you know, is like the day after pisa day. so i'm sure most of you filed

some stories about pisa and about, you know, the sky falling and things like that, although i haven't actually seen much of that. i saw, actually, a lot of really good reporting under the numbers, and i just want to thank all of you for that. and, you know, we've been through this rodeo before. this is the third or fourth time that pisa results -- the third time in my memory, but the fourth or fifth time that pisa results have -- [inaudible] [audio difficulty] what does it say that the united states is pretty much in the middle of the pack on mathematics, science and english? and particularly this year where there was a real focus on mathematics for the first time in ten years. it says two or three things. number one, it says that things like poverty, socioeconomics

really matter because you look at the states like massachusetts and connecticut that did well and what they've done, and you look at the data when you pull it out and try to account for poverty, and you see where the statistics are. but there's more to this, because if you just stop there, we're in the inane debate that we've been in for the last 20 years. be because th issue is not whether poverty matters, but what do we do about it? so the dominant strategying with, educational -- strategy, educational strategy that we've done about it for the last ten years is no child left behind and race to the top. there's been a wunsch of other thing -- bunch of other things like charters and competition and now new standards, but that's the hypertesting, the

sanctioning of teachers, the closing schools. that's a the dominant strategy. and i think what we learned from the last, isa results is -- pisa results is that strategy is not what works to move the needle. it keeps us where we are, but it's not what works to move to needle. and so that's why you start looking at what do the other countries do that actually the ones that outlapped us, what do they do? and i'm not suggesting we should be finland, and i'm not suggesting we should be shanghai, two places that i've been to, but the united states is different. but we have to look at some of of the things that they've done and say can we adapt that. so let me click off the four things, and then let me go to what we are trying to do to accomplish that. number one -- >> all in about four minutes more. >> that's okay. be -- number one, we actually

have this, you know, the countries that outcompete us actually really value, deeply respect is and value public education. in fact, the pisa results actually have a big caution flag -- saying that for my friends at the examiner -- they have a big, big caution flag -- >> [inaudible] >> no be, but the data is important to look at. a big caution flag about the choice and competition and about how that has increased segregation and poverty in countries like chile who have used it as the dominant education theory. number two, it says a lot about preparing teachers, supporting teachers, giving them time to collaborate as tom friedman has seen in shanghai and has written about it. number three, apartments are really -- parents are really engaged, and they're really engaged. not just told what to do, but they're really engaged. number four, you know, the

champion core matters and standards matter, but done the right way. not just thrown out there and say go do it, but really implemented well. and you see that in the countries that outcompete us. and last, poverty does matter, but we these to lead with -- we need to lead with equity investments and equity strategies in order to address that. so things like pre-k, um, like wrap around services. that's what it says. so the bottom line is what do you do about this. now, there's a whole bunch of groups, including our union and n be ea and the opportunity -- nea and the opportunity to learn group of community partners parents who have actually started talking about this for the last two or three years. and we had, we have what we call now the principles for unity. we're having a big day of action on december 9th about reclaiming

the promise of public education. not as it is today, not as it was 50 years ago, but in order to actually be something that full fills our collective -- fulfills our collective responsibility for individual opportunity for all kids. so that means really doing things such as having well prepared teachers. and if teachers are well prepared and if they're supported and if they still can't do their job, they shouldn't be there. but we have to have fair evaluation systems. we also have to have standards. i'm a big, big believer of a common core, but they have to be implemented right, and we have to do the kinds of things like california has done which is delink testing at least for the time being so that we can actually prepare and actually try to make these work. be number three, we have to actually focus on poverty about how we insure that kids have a level playing field. so the re-k programs, the wrap

around services we need to do. and last, every school that works, every district that works focuses and makes sure that schools are welcoming, safe environment. welcoming, safe and collaborative environments. you can't show we a school that works or a district or a state or a cub that works -- country that works where that notion of collaboration as opposed to competition, that notion of welcoming and safe environment so that schools are central to communities are not the dominant theory as as opposed to testingd sanctioning. and so that's what we are trying to do, work with community, bottom-up solutions that are aligned with what communities need, great neighborhood public schools and, ultimately, really trying to make sure that every -- that public education is an anchor of our democracy, a to pell hour of our economy and

probably most important, really, really make sure that we give and figure out how to enable all kids to have the opportunity to not only dream their dreams, but achieve them. >> and we are live this morning awaiting remarks from treasury secretary jacob lew on implementation of the dodd-frank financial regulations law. he will be introduced by former fdic chief sheila bare. one to -- sheila bair. one of the regulations still to be finalized is the so-called volcker rule. regulators are scheduled to meet next week to discuss and vote on the final version of that rule. the pew charitable trust is the host of this event, it should get upside way in just a couple of moments. this is live coverage on c-span2. ..

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[inaudible conversations] [inaudible conversations] >> once again we are live from the pew charitable trusts in washington, d.c. for remarks from treasury secretary jack lew on implementation of the dodd-frank financial law. he is expected in just a moment. live coverage here on c-span she. while we had a couple of minutes with several more light events

coming up today on c-span2. in a little bit in a little bit the house energy and commerce subcommittee on energy and power will hold a hearing on the federal energy regulations commissions role and authority. cheryl lafleur is set to testify. that's coming up live beginning at 9:30 eastern here on c-span2. also at 1:15 p.m. patrick leahy of vermont talks about the obama administration's policies on human rights as well as future congressional action. he will appear at the second annual human rights. the event coincides with the 55th anniversary of the signing of the universal declaration of human rights. that was adopted by the u.n. general a summit on december 10, 1948. that event gets underway at 115 eastern on c-span2. [inaudible conversations]

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>> lives once again from pew charitable trusts here in washington as we await remarks, secretary lew. you will discuss implications of the dodd-frank financial regulations law. a couple of stories from "the associated press." a number of americans applying for unemployment benefits tumbled last week, 20,000, to 298,000 nearly a six-year low. it shows companies are laying off fewer workers. applications have fallen in seven of the past eight weeks. a hopeful sign for job growth at the end of year. the white house is pushing to extend jobless benefits to long-term unemployed americans. the argument is if benefits don't get renewed by the end of the month more than 1 million people will loose the assistance which will slow economic growth. the government released a report today that says congress has

renewed benefits on unemployment when it's lower than 7.3%. new jobless numbers are due out tomorrow. [inaudible conversations] >> good morning, everyone and thank you so much for joining us for this very special event. a little housekeeping before i get started.

please want to secretary lew has finished his remarks if you'd stay seated until he leaves, that would be appreciated. he has a tight schedule. we are very honored to be hosting the 76th secretary of united states treasury, jack lew. this event is a tribute to the pew charitable trusts which under the steady hand of our president has become a major an influential voice on many of the toughest issues confronting society today. throughout its 65 year history, pew has remained faithful to the guiding principle articulated by its founding patron joseph pew in 1946. to tell the truth and trust the people. health care, environment, economic mobility our democratic processes, pew has broken truth to power to improve the lives of millions of people throughout the world. and, of course, almost two years ago, pew along with the cfa institute cofounded the systemic risk council, and nonpartisan group of policy experts and former regulators which has sought to give voice to the

people's interest in a safe, stable financial system. so i am particularly pleased that secretary lew will be speaking this morning on the importance of completing the financial reform agenda. secretary lew came to his current job as a widely respected expert on budgetary and fiscal policy. he has spent the vast majority of his career in government and once characterized public service as his highest calling. his expertise and knowledge have proven invaluable as he has steered the nation's -- but did -- he's also brought a very fresh perspective and vigor to the cause of financial reform in his role as chairman of the financial stability oversight council. he has spoken eloquently of the need for regulators to finish the important task that the dodd-frank law hasn't played before that he has warned of the risk of public cynicism and disillusionment. if regulars cannot tell the american people we have into too big to fail. he has steadfastly locked against his efforts to reopen

dodd-frank and recognizing that those efforts would almost surely lead to a weakening of that landmark law. he has rightly argued that regulate should be given time and adequate funding to strengthen our financial system through dodd-frank implementation. he supported tougher requirements on money and market reforms, and importantly he has tackled the thankless job of alternative chastising, coaxing and cajoling five different regulatory agencies to finish the long overdue work on the volcker rule. i think his mother should have given him than middlemen of job instead of joseph because his demonstrate that patients of the biblical figure. and if press reports are accurate, -- secretary lew, i commend you for a commitment and resolve to protect the public from everton facing the prospect of lost home, lost jobs or lost cities caused by financial system run amok.

ladies and gentlemen, please join me in welcoming secretary lew. [applause] >> thank you very much, sheila, for the very kind introduction, and for all the work that you do to advance the cause of financial reform. i'd like to thank you for hosting me here this morning and also for the work that you do everyday, so many important public policies. i'd like to spend a few minutes today discussing how far we've come to repair the weaknesses which shook our financial system to its core just a few years ago. the progress we've made reshaped and our financial architecture and what we need to do to remain vigilant to make sure our financial system is safe in the future. five years ago to train the economy was reeling from a devastating financial crisis that helped trigger the worst recession since the great depression. our businesses were shedding more than 700,000 jobs a month. our economy was shrinking at an

8.3% annual rate. credit was frozen. our auto industry was sliding towards the abyss and millions were losing their homes and their life savings. to make matters worse, to contain the damage and keep our economy for melting down completely, american taxpayers were forced to provide extortionate assistance to financial institutions and other companies, many of which i take risks that contribute to economic crisis. the president faced an economy teetering on the edge. in response to quickly move to put out the financial fires, restore growth and get people back to work. he was also determined to make sure that a financial crisis like this never happen again. this effort produced the most comprehensive overhaul of our financial system since the great depression. bringing our financial system into the 21st century, and creating tools to address a complex and ever-changing market, a set of markets and institutions. these reforms greater the strongest new financial safeguards for consumers and investors in nearly a century. as a matter of law they stayed

clear that no financial institution is too big to fail. five years later our economy has steadily grown. our businesses have created nearly 8 million jobs over the past 44 months, our housing market is recovering, and our financial system is stronger and once again an engine for economic growth. a lot of progress has been made and one of the main drivers has been the work of agencies and regulators to repair a badly damaged financial system. as regulators complete the remaining core element of wall street reform, there are four things we need to keep in mind. first, the rules of the road must be effective in designed to address the modern financial markets. second, we must make sure that regulators have the resources necessary to get the job done and they are held accountable. third, other countries need strong standards and mechanisms to address risks that reach across borders. and, finally, we must remain vigilant to potential new

threats constantly monitoring the way that risks change and evolve and pursuing reforms to reduce risks stemming from both traditional banking and the shadow banking system. while the process of putting these reforms in place has taken longer than we hoped, much has been done. and much is being completed. we are committed to finishing the job. but as i said before this is not about writing a set of rules and then walking off the field. this will require ongoing attention, ongoing fact-finding, review, analysis and action. ultimately, the measure of our success will not inject how fast they're put in place but rather how we strike the right balance. that is banking deep liquid financial markets that promote strong credit creation and lending, ma and protecting our economy and the american taxpayer from excessive risk-taking. with the completion of the volcker rule, resolution authority, and stronger capital and look what are the requirements, the tools of finance reform are being used to make our financial system safer and told financial institutions

responsible forbearing their own risks without the backstop of public support. regulators have worked hard to find the right balance that protects our economy and taxpayers will also leaving room for well functioning financial markets that fuel growth and help the private sector create jobs. the dodd-frank rules on the road address the root causes of the financial crisis and be the challenge of regulating today's financial markets. a premium on consumer financial protection curbs on an excessive risk-taking, transparency and oversight and a massive over-the-counter derivatives market, and the necessary tools to prevent large financial institutions from threatening the financial system. these reforms are transforming the way wall street operates. as we know some of the greatest damage to both ordinary individuals and major financial firms began with deceptive and harmful practices that left millions always more than they could ever realistically repay. dodd-frank created the consumer

financial protection bureau to increase transparency and choice, and to prevent unfair deceptive or abusive practice. since opening its doors in 2011, they have taken bold and decisive action. the cfpb moved quickly to strengthen consumer protections in the mortgage market, bringing payday lenders and debt collectors under federal supervision for the first time. and to provide extra help to those like the elderly and military families who were targeted by a group with lenders. the cfpb is new qualified mortgage standards which help protect against risky loan features that armed homeowners will go into effect in a few weeks. just a few weeks ago the cfpb created new mortgage disclosure laws. these new forms replace several complicated overlapping documents and disclosure requirements with two cleared easy-to-understand forms that make homebuying simpler and more understandable for all americans. five years ago most americans did not know, even know what the enormous over-the-counter derivatives market was its lack of transparency and lack of

oversight put all of them, our economy and our financial system at risk. dodd-frank set forth comprehensive requirements to this previously unregulated market and the commodity futures trading commission and the securities and exchange commission have been working hard to implement these rules of the road. earlier this year requirements for trading platforms, central counterparty clearing and trade reporting went into effect. reducing risk from derivatives by creating transparency and moving towards more standardized transactions. in september, g20 leaders agree to use initiative proposal that establishes global margin standards for unclear swaps. regulators both here and abroad will make sure that consistent safeguards across borders protect the financial system from external shock. part of ensuring that financial institutions bear the risk is to make certain they have sufficient capital to absorb the losses that they face. tough capital standards were put in place this summer, and banks

will begin complying next month. rules requiring the largest firms to decrease leverage were proposed this year and will soon be finalized. a hundred dodd-frank, bank regularregulars conduct annual s test determined if the largest and most complex u.s. banks have sufficient capital to withstand severely adverse economic and financial conditions. for banks that do not pass these rigorous tests, change is required, including raising capital and suspending dividends. we will finalize new in incidental standards soon to go beyond capital and liquidity impose tougher was mentioned standards and reduce interconnectedness for the largest and most complex financial institutions. there's measurable progress. the largest banks are now better capitalized and less leveraged adding more than $450 billion of capital since the first quarter of 2009. on top of that dodd-frank restricts the types of high risk activities in which banks can

participate. next week regulators will begin voting on the volcker rule putting in place to frustrations on proprietary trading and investing in private funds by banks. rule writers will soon put forward a tough volcker rule that i expect to be true to president obama's vision and the statutes intend. the rule now before regulators for a vote is a product of much intensive work and analysis and needless to say, years of effort. it prohibits risky proprietary trading while protecting economically essential activities like market making such as when a firm facilities selling bonds for a mutual fund. the rule prohibits risky trading that's like the london whale, and puts in place strong compliance requirements that require those in charge of financial institutions to make sure that the tone at the top sends the right signal to the whole firm. now, in order to make sure that taxpayers are truly protected, it is critical to have an effective resolution process so that individual firms did not

jeopardize an entire financial system or leave taxpayers at risk. dodd-frank cribbage the use of taxpayer dollars to bail in any financial firms. in ending too big to fail requires that any future crises we can and will use the tools the law provides. the largest financial companies have already submitted living wills or blueprint for how to unwind firms if they fail. regulators will require firms to rework these plans if they are not credible. and if firms are unable to provide a credible plan, regular skin impose remedies including requiring firms the that are realigned their businesses. also regulars have already issued rules that make clear how to implement the orderly liquidation authority which allows the federal deposit insurance corporation to take over a failing firm and wind it down safely over time. they are content develop strategies and guidance for resolving major financial institutions with minimum disruption to the financial system. there's still more work to do,

particularly to make sure that international rose mesh with our own since as we know too well financial crises do not respect national borders. while we will not know how well these tools work for certain until they're tested by a true crisis, several things are clear. dodd-frank into it too big to fail as a matter of law. top rules are now in place to make sure banks have the capital to absorb their own losses. monitoring through stress tests is under way. and resolution authority's and plans are in place. there's a growing recognition to these changes and market analysts are factoring them into their assumption. put simply, the reforms we are putting in place raise the cost for a bank to be large requiring firms with to internalize the risk and together with resolution authority and living wills, make clear that shareholders, creditors and executives, not taxpayers, will be responsible if a large institution fails.

earlier this year i said if we could not with a straight face say we ended to big to fail we would have to look at other options. based on the totality of reforms we are putting in place, i believe we will meet that test. let's be clear, there's no precise point at which you can prove with certainty that we done enough. if individual need to take further actions, we will not hesitate. an essential part of the meeting that test will be to make your regulars have the resources necessary to police markets and financial institutions effectively. even with the best rules, illegal behavior our excessive risk-taking will go unchecked and less regulators have resources to conduct examinations, monitored such behavior and go after those who break the law. the point is this is not an either or proposition. the best rules will fall short without effective supervision and enforcement. and effective supervision and enforcement are only possible with sufficient resources. after failing in efforts to block or rollback reform, some in congress would have simply

starve regulatory agencies of funding so they lack the resources to do their jobs. failing to fund supervision and enforcement of the new rules amounts to virtual the regulation and puts americans at risk that financial threats will go unchecked. even in tight budgetary times, this is not a budget driven choice and we must provide regulators with sufficient resources to make the financial system work and protect working families from financial harm. how could any of this say to someone who lost their job, home or retirement security because of lax oversight that a safe financial system was a luxury we cannot afford? we saw what that happen in 2008 and a cost americans trillions of dollars and untold human misery. we cannot let that happen again. the work these agencies do is money well spent. for example, in fiscal year 2013 alone a cftc -- including almost

$1.3 billion for abusive actions related t the manipulation of libor and other financial benchmarks. these sanctions made our system is safer and provide a disincentive for firms to engage in behavior that undermines market integrity and americans faith in the financial system. in the near term, it's essential congress provide adequate funding for our regulators, but if in lieu funding a sunday fiscal congress should consider moving the market regulating budget out of the current budget process as the president proposed and treat them like our banking agencies with our self-funded through industry fees. that way instead of unpredictable funding that shift from year to year, oversight will be guaranteed. political winds they shift but the governments ability to protect markets and make sure they are safe must be constant. there are also ongoing efforts to strip the consumer financial protection bureau of its independence and undermine its ability to protect consumers.

in only two years the cfpb has already proven itself an effective in force are pushing back on predatory practices and abusive tactics. already the cfpb has taken enforcement action that resulted in companies refunding hundreds of minutes of dollars to consumers and we must make sure that the new consumer agency is able to continue its vital work. you can understand why some out there would want to rein in this agency. it's now harder to process some unfair, deceptive and abusive practices. and it needs to stay that way. as we fund and support our regulatory agencies we also need to hold them accountable. dodd-frank act sets high expectations for regulators and gives them the tools they need to protect ordinary americans and the broader financial system. there has been and will be ongoing debate on what are the right levels for capital and liquidity and decisive banks and the structure of markets. in a few moments i'll discuss some of the areas regulators

need to keep their eyes on them including the money market fund industry and the triparty repurchase agreement market. but one thing is clear. the regulators that congress charged with these duties continued use the tools at their disposal to reduce excessive risk in the system. and if necessary, regulators can and should do more. regulators must understand risk exposure, demand strong compliance and reporting, and promote effective risk management system. when regulators see failures and input controls like the failures that occurred during the events involving the london whale and mf global, it's critical they hold those responsible to account. regulators like everyone else must behold -- held to the highest stand. stakes are high and the standard for performance needs to be just as high. the u.s. responded to the financial crisis of aggressively and in a bipartisan basis to make our domestic system safer and more secure. but given the global nature of our financial system we must continue working with other regulators for rules so reforms

are as strong as our own. from the outset of the crisis, the time and energy we put into domestic regulatory reform has been impaired with international efforts to promote high quality standards, build a level playing field and reduce risk. we've made considerable progress through the g20 an g20 and the financial said that the board and design a more stable and resilient global financial system. the design is not sufficient. intimidation and follow-through are key, and we must avoid a race to the bottom. next february i will meet in australia with the g20 finance ministers and ongoing use this as an opportunity to call on the world's biggest economies to bear down even more forcefully on implementation. our 2014 agenda is this, we will take steps to make sure that global banks meet high standards we've set. that meets moving swiftly to build strong and high quality capital, properly weighed risk

assets, curb leverage and build strong liquidity buffers to protect themselves in times of crisis. several years ago the g20 recommended that trading, reporting including of over-the-counter derivatives in place by now. the united states has forged ahead in getting that done. we need to make sure that these recommendations are put in place around the globe. there will be difficult cross-border issues to manage and these are made more complex because other nations are moving far more slowly than the united states. major financial institutions work globally and resolution of these firms to work fully, cross-border resolution must be part of it. the failure of lehman brothers demonstrated that the absence of cooperation between domestic and foreign authorities to resolve a financial company can endanger the global financial system, and underscore that any future new resolution tools will need to work across borders. our agenda in the coming year will focus heavily on completing the work underway on international arrangements that establish a hom home and post a

force will cooperate to wind down a globally active firm in an orderly way. the failure to work out such arrangements could pose a significant future risk to our financial system. treasury is emphasizing this as a pretty and we're working with our domestic regulatory partners and international counterparts to get this in place. the u.s. is working close with our colleagues internationally to reform financial benchmarks like libor and make sure that alternatives are developed and in place, available to be in place. as we have seen with libor and circumstances around foreign exchange rates, we must guard against the potential for market manipulation both domestically and internationally. we will also prioritize our work with international partners on ways to address the risks from short-term wholesale funding markets and shadow banking, complementing our domestic effort. in short, we are leaders in a special effort to develop, enhance measures for all types of financial institutions, and working to align these approach

with a strong u.s. framework. our aim is clear. we want a global race to the top. while finishing high standards of free trade agreements presents real opportunities to drive growth and create jobs, we can't allow these agreement agro serve as an opportunity to water down domestic financial regulatory standards to let me be clear, we will press other jurisdictions to match our robust standards including in europe and across asia. we will do so by continuing to pursue our international regulatory agenda in a bilateral and multilateral forum that we have been and will continue to be at the forefront of, advancing global finance reform. such as the g20. this will prevent gaps in oversight and protect taxpayers from financial risk. implementing the dodd-frank act and international agreed upon basel stand and the courage and global alignment with our strong reform, are all necessary steps towards safer and sounder financial system.

but as we take these steps, it's also essential to remember that the crisis revealed that regulation and oversight failed to get up with a rapidly evolving -- rapidly evolving financial system. we must remain vigilant. dodd-frank created two new organizations to help combat potential new risk, the financial oversight council and the office of research. the council brings the regular dinner get together and charges us to look across our areas of responsibility whether its banks or markets or other financial institutions and to identify risks that may emerge in the future. the office of financial research is working to understand what data we need to better track risks and what we can learn from that day. their leading average great international data standards so we can anticipate the next crisis with information that is accessible and usable. part of the current focus of these new organizations as non-bank financial companies and

shadow banking activities. these firms actually banks and fill similar roles in the financial system but without the comprehensive oversight or safeguards that banks are subject to. it's essential we better understand and address the risks that these terms and activities present. the triparty repurchase agreement market is a critical source of short-term funding but with vulnerabilities. particularly the reliance on intraday credit. federal reserve has taken steps to reduce this vulnerability and improve risk management practices for both borrowers and lenders. while the money market fund industry plays an important role in the everyday financial needs of many americans, it's not without risk as assigned financial crisis some funds were susceptible to runs a new protections were needed. the council made recommendations for additional reforms to supplement changes made by the fec in 2010. the sec has proposed additional reforms and is working to finalize them. having stronger protection for the money for an industry goes

hand-in-hand with the broader work we're doing to safeguard the financial system. the council will continue to work closely with the sec advocating for stronger forms to the score financial product. the council on the office of financial research or for filling their charge to look across the financial system and evaluate risks they pose a threat to financial stability. for instance, at the councils request, the oh of our recently put forward a study of asset management industry to inform the council's understanding of risk in the sector. 's report provides account with important analysis as it begins to look at where the asset management industry and its activities present risks to the broader financial system. we also cannot forget the importance of reforming the housing finance system to enhance financial stability. and it's important we work with congress in a bipartisan basis to get legislation to get this done. as the council noted in his most recent annual report, significant housing finance reform it still need to add clarity to the market and attract more private capital.

going forward, we cannot be afraid to ask tough questions with an open mind and without preconceived judgment. and influence by data and analysis we should act as this is to promote stability of cross our financial system. we knew from the start that reforming our financial system could not happen overnight. perhaps if we were building a regulatory regime from scratch or if our financial system were less complex, it may have happened faster. our financial system is an elaborate engine that fuels economic growth but it provides credit for homes, cars and education. it helps small businesses by inventory in the april and it helps the largest employers hedge risk so that sudden changes do not mean layoffs or shutdowns. we've made tough choices and very significant progress toward reforming our financial system. every day, more change comes not just on paper but in the way banks, private funds, exchange is including houses do their business. as we move forward in a new

higher standards are facing, the changes will be even more apparent. our financial system will be even more secure. because our financial system is always evolving, this is work by basic nature is never finished and it is our ongoing obligation to remain vigilant and responsive to dynamic and changes to the financial system. thank you very much. [applause] >> we are honored by your presence and we hope that you accept an open invitation to return to the pew trust often. i want to thank you for your candid and compelling comments, and for all that you're doing to right wrongs on the health of the american public that is long overdue. and for the work that you and your team do, promote our economic recovery, to protect consumers and to promote policies that will allow every

american reach for a financial sustainability and their piece of the american dream. and i, too, believe the public service is our highest calling and want to thank you for your leadership. also to our to distinguish i was at the pew trust, sheila bair and senator warner, for their distinguished service to our country as well. and for all of you for being here today, and i ask that you keep your seats while the secretary takes his leave. thank you very much. [applause] [inaudible conversations]

[inaudible conversations] >> as visiting comes to close "the associated press" reporting that the white house is pushing to extend jobless benefits to long-term unemployed americans. the arguing is that benefits that don't get renewed by the end of the month, more than 1 million people will lose the assistance which will slow economic growth. the government released a report on that today. a couple of life events coming up today here on c-span. the house energy and commerce subcommittee on energy and our will hold a hearing on the federal energy regulatory

commission's role and authority. that will happen begin at 9:30 a.m. eastern. and also at 1:15 eastern senate judiciary committee chair patrick leahy of vermont will talk about the obama administration policies on human rights as well as future congressional action. while we wait for the start of the house hearing on the federal energy regulatory commission's role and authority, show you a portion of the defense department briefing from yesterday with remarks from defense secretary chuck hagel and joint chiefs chair general martin dempsey on pentagon spending cuts. >> all these decisions will not only result in a smaller and flatter osd but one that i believe will be better prepared for serious and complex 21st century security challenges that we face as a department and as a nation. and is constrained budget environment, we will continue to look for ways to reduce overhead, improve efficiency and

maximize combat power. but we must do so in a deliberate manner after careful consideration of how best to ensure this department is able to carry out its mission of defending the nation. most of the reduction in osd staff that i've announce today will occur through process of natural attrition in order to minimize the impact on workforce. if the department is forced to take this deep sequestration cuts on the order of $500 billion over the next 10 years, we may need to include additional reductions. as i said before, sequestration is irresponsible and poses an unnecessary risk to our military's ability to accomplish its mission and our readiness. congress should roll back sequestration and fully fund the president's budget request which provides the department with the time, the flexibility, and certainty needed to strategically transition our military through a postwar posture. one final point, bureaucracies

are often derided, ma but the reality is that an organization of the dod size, complexity and global reach will always require sophisticated headquarters structures that provide effective oversight and management of our half a trillion dollars in the press to the men and women t who work at the pentagon and other headquarters elements, whether civilian, military or contractors, our dedicated individuals deserve respect and appreciation. even as we realize our headquarters organizations, we will focus new energy on obtaining the world-class professionals to we depend on every day to fulfill our mission and keep this country safe. my expectation is that the changes we make will empower our people by reducing layers of bureaucracy, and making our organization more adaptable, accountable, and agile. i know this has been a trying period for all dod personnel and

their families in the wake of sequestration, furloughs, and a government shutdown. through it all our workforce has been focused and dedicated, and i know they will remain just as focused as we work to put our organization on a strong path for the future. thank you. general dempsey. >> thanks, mr. secretary. just like that with the secretary secretary said about, there's something's we have done whether or not we were faced with the budget control act and this thing called sequestration. and before he mentioned worth noting again, if those are the size of ou our headquarters. so just as he's directed the office of the secretary of defense to make these changes, so, too, will the combatant commanders, the service chiefs as well as freezer headquarters and above throughout the world. second take on precision health care. we have said for some time that we need to adjust or slow the rate of growth in those

activities in order to ensure that the all-volunteer force remains sustainable as well as allows us to balance the force across modernization, training, readiness and man power. third, access infrastructure. we have it and we need to begin to consolidate infrastructure, close certain parts of our infrastructure. and forth of course is acquisition reform where the goal is to make ourselves, to get out of this pattern where things are acquired and delivered to slowly and expensively. we can do that ourselves. we are going to need help across virtually each one of these areas, and will be looking to gain support for the overtime. it's worth noting that last week we entered our 13th year of combat in afghanistan, while simultaneously delivering much-needed relief supplies in the philippines in the aftermath

of typhoon haiyan. and while maintaining a steady state of presence in the arabian gulf, in the eastern mediterranean, and in the pacific. as a backstop to our important diplomatic endeavors as a nation. so as we consider had to maintain our military strength we must always remember our real strategic advantage, and that, of course, are the men and women who serve in uniform. and so the purpose of all of the reform efforts that we've been describing your is aimed at ensuring that we preserve and actually enhance the leadership training and equipping of our forces because in so doing, and in only in so doing will we be sure to keep our nation and in from coercion. thank you very much. >> bob? >> a question for both of you on china. with regard to this new zone,

you called it destabilizing. i'm wondering what you thought your chinese counterpart about this. you think they should roll it back at it like to ask both of you more broadly, what do you see as the big picture significance? are the chinese responding to the u.s. talking about pivoting to the pacific? or how do you make this the? >> as to your first question, bob, i have not spoken to my chinese counterpart. i've spoken to our allies about the chinese adiz. as to your question as the bigger picture, first, i don't know. but i would focus on one particular area here that general dempsey and the chiefs have put a lot of effort into and was very much a centerpiece

of the conversation between president xi and president obama a few months ago. and that is developing a strong multi-military relationship between the pla and united states. we have been working at that, both sides actually, and you might recall that my counterpart, the chinese defense minister was here in august, and i hosted him here. and i've seen him two other times in the asia-pacific, where with me during those occasions. we are working toward a stronger relationship to build some mechanisms to address some of these tension issues, which probably are not going to get any less complicated in the east and south china sea. it's important for china, japan,

south korea, all the nations in this area, to stay calm and responsible. these are combustible issues. that's been a role that we have tried to play in the united states, and in the influence that we have in that area, with our allies. but this is a time we need to carefully, all of us, work through some of these differences. and that's the position that we've taken. it is important that in an international community that's getting more and more crowded, that we all understand and have common interest in the preservation of open and free sea lanes, and what's in the interest of our countries, our economies, our securities, and we're going to have to work on

mechanisms that help a comedy that rules - -- accommodate that in other as big that's an area where we can continue to play a role in, and will. [inaudible] >> well, i think we've made it pretty clear what our position is, the united states, on this. and it's not that aid itself is new, or unique. the biggest concern that we have is how it was done so unilaterally and so immediately without any consultation or international consultation. that's not a wise course of action to take for any country. >> you can see this entire briefing after website, c-span.org. the house energy and commerce subcommittee on energy and power is meeting on the federal energy regulatory commission role and

authority. cheryl lafleur will testify on with the agency's three commissioners. congressman ed whitfield chairs the subcommittee and congressman bobby rush is the ranking memb member. >> the commissioners at ferc are with us today to put pressure very much your being here. i certainly initially would like to congratulate cheryl lafleur who has been appointed the acting director of ferc, and i enjoyed our meeting yesterday, ms. lafleur, and we look forward to working with you on many issues facing our country as we adjust to this changing landscape that we all are very much involved in. i would say that i think the transcendent issue that certainly encompasses everything we're talking about today does relate to the way the changing

landscape is energy in america, with this low price natural gas we see a transmission from coal to natural gas. many states, and this administration particularly, are being very aggressive in trying to increase the amount of electricity produced from renewables as they try to address climate change. and i would say that as we move forward, and i would think you all particularly have to be sensitive to this, is that frequently meet people in the administration and other groups point to europe as the model for america. and yet in europe 20% of electricity is now being produced from renewables. they have an overcapacity of electricity in europe, and as result, they have very low wholesale prices which is good,

but the residential rates and their manufacturing rates are the highest in the world because renewable surcharges. and so what's happening over there is they're trying to make this transition to quickly, in my view, and that's what people are trying to do in america as well. but what's happening over there is that the utilities, the baseload utilities, have lost like $800 million in market valuation over the last 15 months or so. and so as you go to renewables and you try, you have to place more emphasis on distribution at the local bubbles, there's not enough capital in the utility industry there to meet those needs. and so they have a real conflict in europe right now, and interestingly enough, they have mothballed 30 gigawatts of electricity that plants

producing electricity from natural gas in europe because of the high cost of natural gas coming out of russia. and we had our largest export market of coal last year in recent memory, and the europeans took 45% of that. because when germany closed down their nuclear power plants, they realize, and over passionate other countries over there realize they have to use goal. for this administration talks all the time about all the above policy is in effect in greenhouse gas going to prohibit even the option of building a new coal powered plant in the future. so if we're going to talk about and all of the above policy, and say that is our policy, then that should be the policy -- that should be the policy. and so would introduce legislation -- we don't expect anybody to build a new coal

powered plant right now with natural gas prices so low. but in the future like in europe they are discovering it should be an option. and so i look forward to testimony of the commissioners today to get some of their views of the many challenges facing us and i look forward to your comments, mr. norris. i know you made a comment result in a smart grid conference in november about you, your personal view is we don't really maybe need anymore infrastructure for natural gas and fossil fuel. i may be wrong but i think he made that comment. and many of us would disagree with that, particularly with the additional feel that we have, the northeast talks to his all time about not having a infrastructure to get the gas to where it needs to be. but we all recognize we have a lot of challenges. we can't meet those challenges unless we work together to meet them, and we're going to continue to provide an

alternative view as this administration, particularly in every of energy, where we think that there are serious disagreements and with dire consequences that are possible. so with that, at this time i would like to recognize the gentleman from california, mr. mcnerney, for his five minute opening statement spent let me thank the chairman for calling this hearing today, and it's a real opportunity is have all the commissioners in front of us i want to thank you for coming out here today. this is an area i have a lot of passion for and a good background in. as we know, ferc has broad jurisdiction over the electricity and natural gas markets such as setting electricity and transmission rates, overseeing regional transmission organizations such as the one we have in california. it's now time to make some important decisions about our nation's energy infrastructure and ferc would be an essential component of that decision-making process.

increase renewable energy production, growth of natural gas and the need to ensure a secure grid will all be critical issues. in fact, there's no shortage of issues to discuss including what defines the public interest with natural gas exports, licensing challenge export facilities, licensing natural gas pipelines, smart grid innovation, renewable energy to name only a few. states such as california are implement them aggressive renewable portfolio standards and there's a need to ensure grid stability. is becoming increasingly important that we have an energy infrastructure that's capable of meeting these demands. our energy infrastructure needs cyber and physical protection. threats to our grid are real and transition to smart grid presents both an opportunity and a threat to grid security. the energy policy act of 2005 made significant progress

providing ferc the authority oversee power grid and to establish critical infrastructure protection. however, more needs to be done to protect the grid. the energy policy act focused on both power systems which can exclude some transmission local distribution and other grid facilities. i think it's worth exploring ferc's role in the grid, an area of increasing innovation and technical development. these are areas which we can improve upon such as response during emergency situations and addressing potential improvements to critical grid infrastructure protection initiatives. ferc's coordination with the north american electric reliability corporation -- little bit of a mouthful -- regarding standards and reliability such as those related to cybersecurity remain a high priority for me.

lastly, we must analyze these challenges in the context of climate change a series threat to our nation on several levels that has been acknowledged by scientists as well as leaders at the pentagon. combine these issues will dictate how we were able to manage and respond to rapidly changing energy technology, as well as managing supply and demand in the market. at this point i would like to yield to my colleague from texas, mr. green. >> thank you, mr. chairman, and thank my ranking member for yielding to me and allowing me to be. today our witnesses will discuss issues that face our country now and in future including great security, gas, electric ordination from electricity transmission and infrastructure permitting. it's important to note that texas is the face of the changing energy landscape. in texas we have demand for energy that is growing exponentially. we have great issues that

threaten our economic growth. we have infrastructure needs for market delivery and power generation. we must coordinate and balance all these challenges with the resources mrs. it to overcome them. wind power and natural gas offer taxes away to clear all these options. additionally, our domestic of life lost to meet our judges and those of our neighbors. those must be addressed directly. last month we held a hearing on h.r. 3301, the north american energy infrastructure act. adhering ferc was concerned about h.r. 3301 with the effect of the ability to comply with section three and section seven of the natural gas act. i think after initial misread want to emphasize that ferc section three and six of the 40 remain in place. in fact, h.r. 33 to one provides ferc additional authority by eliminating the presidential permit process, creating a regulatory structure within the commission and gives ferc is the ability to approve the import or export a patch of grass across national boundaries but i think we need members of this subcommittee has confidence in ferc's pipeline permitting

ability and h.r. 3301 is an example of that. i look forward to discussing all these issues today and thank our witnesses for being here and again, thank my ranking member for yielding to me. i yield back the time. spent gentleman yields back. this time of record as the chairman of the full committee, mr. upton of michigan for five minutes. >> thank you, mr. chairman. america's energy picture is rapidly changing. america's energy regulators have got to keep pace. long held belief in american energy scarcity have given way to a new era of energy abundance, especially in regards to oil and natural gas. like many policies and attitudes are still rooted in the outdated assumptions of shortages and rising imports. with the potential to strike the opportunities before us. ferc is in the middle of many of those debates. for example, america's new abundance of oil and natural gas requires new infrastructure to meet demands and keep prices affordable. we've got to build this architecture of abundance

quickly, given that america's role has been rising every year in -- nearly every new project is met with stiff resistance at every step of the process. components are enabled by an archaic federal register process that can be manipulated to cause years of delays for pipelines, power lines, lng export projects in some cases and block them out right. while the process that ferc generally works well, there's always room for improvement. canada, australia and most eu nations have deadlines for the environmental regulatory agencies to act. why shouldn't the u.s. hold our agency to a similar standard? congress has been active to keep pace with the new energy landscape. the house passed h.r. 1900 them a bill factories more attentively for the natural gas pipe find approval process. will soon be considering other infrastructure projects as well, including a bill that i co-authored with my friend gene green, to bring more certainty

to energy projects across our border with canada or mexico to help create a more robust and self-sufficient north american energy market. american energy holds tremendous potential for millions of jobs and for a portable energy prices from everyone from homeowners and small businesses, certainty manufactures. the u.s. is always a proud global leader in the state of responsible development of our resource. the prospect of lng exports not only means jobs to the u.s. budget also means improve relations with allies and trading partners and enhanced standing around the globe. but none of these benefits can be achieved if in america's energy is choked off by red tape which is precisely why we are examining the ferc policies today. i did for the working with the acting chair and all of the commissiocommissio ners before the committee. i look forward to a constructive and productive dialogue and process as we move into next year and the years beyond it and i would yield time anyone to our

side. if not, i get back the bows of my time. >> the gentleman yields back about this time. at this time recognize mr. waxman for five minutes. >> thank you, mr. chairman. i would like to thank each of the commissioners for being here today and i want to congratulate ms. lafleur on her new role as acting chair. the federal energy regulatory commission has a broad range of enforcing -- important issue before it, renewable energy integration and electric transmission modernization the hydropower licensing and enforcement actions to prevent energy market manipulation. but i want to focus on the issue that has not gotten enough attention during this congress, and that's great security. the nation's critical infrastructure and defense installation simply cannot function without electricity. yet it is clear that the electric grid is not adequately protected from physical or cyberattacks. these are not theoretical

concerns. just this april there was an actual attack on our electricity infrastructure. this was an unprecedented and sophisticated attack on an electric grid substation using military style weapons for the attack. communications were disrupted. the attack inflicted substantial damage. it took us weeks to replace damaged heart. under slightly different conditions, there could have been a serious power outage, or worse. the fbi and others are investigating this attack. so as to not harm any ongoing investigation i won't disclose details of the incident but i have been in touch with the fbi and they are willing to provide the members of this committee with a briefing on the very real threat that attacks like this post to our critical infrastructure. and help the chairman will work

with me to get that briefing scheduled quickly so that members can get the facts. the april attack is hardly the only threat facing the grid. a few months ago in arkansas, there were multiple attacks on power lines and grid infrastructure that led to millions of dollars in damage and brief power outages. independent engineers also recently discovered a new cyber vulnerability in the software used by many electric grid control systems. we rely on an industry organization to develop reliability standard for the electric grid through a protracted, consensus-based process. ferc lacks authority to directly address these threats and vulnerabilities. that's incredible. ferc lacks the authority to address the threats. congress needs to fix this gap in regulatory authority. in 2010, the bipartisan grid act

would have provided ferc with the necessary authority. there was a bipartisan consensus, that national security required us to act. that bill was reported out of the energy and commerce committee by a vote of 47 and 4r nothing. and then it passed the full house by voice vote. however, the senate did not act on this legislation. thank you we worked on this issue in a bipartisan way in the past, and he should be able to do so again. we need to give ferc important new authorities like the authority to take action to protect the grid in emergencies. this is a national security issue that deserves our attention. we should act now while there's still time to protect against successful attacks. thank you, mr. chairman for this chance to make the opening statement. i look forward to the testimony of the members of the regulatory commission him into an opportunity to engage them in questions.

yield back my time. >> gentlemen -- >> is there any other member on our site he wishes a minute? yield back. >> that concludes the opening statements. so at this time i would be recognizing each one of you for your five minute opening statement, and all of you are skilled witnesses and you know that our little lives, red, yellow and green, what they mean. so the only reason i mentioned that is we are expecting some votes on the floor sometime this morning, and i'm hoping that will have an opportunity to go down the road before that happens. ms. lafleur, you are recognized for five minutes for opening statement. thank you. >> thank you very much, chairman whitfield, ranking member mcnerney, and members of the subcommittee. my name is cheryl lafleur. for three and a half years i've had the privilege of serving as a commissioner on the federal energy regulatory commission, and i figured before this committee, subcommittee previously in that capacity.

today, i added before you as the commission's acting chairman and appointment i received just 10 days ago. thank you for your good wishes on the look forward to working with my colleagues and the wonderful employees at ferc in my new role. thank you for holding this hearing today. my colleagues and i appreciate the opportunity to get the attention you give to your oversight duties and the opportunity to share our work with you. i'm honored to lead the commission at a time when our nation is making substantial changes in the power supply and its associated infrastructure to meet environmental challenges and improve reliability and security. in particular, as you noted, we are seeing significant growth in the use of natural gas for electric generation due to the increased availability and affordability of domestic natural gas, after the relative environmental advantages and flexible operating acoustics of gas generation.

and that's i think a significant vantage we have over europe with the abundance of domestic natural gas the balance our renewable resources. the second driver change is ours. this renewable and demand resource which is being fostered by develop and and technology and by policy initiatives in 39 states and at the federal level. finally, new environmental regulations are also contributing to changes in power supply. although the drivers of power supply changes are largely outside the commission's jurisdiction, we must be aware of and adapt to these departments to carry out our responsibilities to ensure just and reasonable rates, and reliable power grid, and fair and efficient electric and gas markets. my colleagues will discuss several of the ways we are responding. we divide up these topics and i want to focus the balance of my testimony on another critical aspect of our work, reliability and grid security.

ensuring reliability means that the commission and nerc, really take care of two things. one is the day-to-day nuts and bolts activities like trimming chains and sending released to keep the lights on, emergency response but in the second is emerging issues like cybersecurity. i believe we're making progress on both fronts. in the past three years you voted out numerous orders on the day-to-day type standards of tree trimming, frequency response, planning for criteria and so forth, and we hear from nerc they are seeing a reduction in transition related outages in the grid as opposed to previous years. going forward we very much have to build on that progress. the emerging issues are somewhat different because we have to try to set standards in an environment of incomplete information we don't have the benefit of decades of experience and challenges are evolving, but it still and comment upon us to

try to develop meaningful, costt efficient regulation to begin a force in an environment of imperfect knowledge. two weeks ago, the commission approved version five of the critical infrastructure protection standard that covered the bulk electric grid against cybersecurity incidents. they are not perfect. we did ask some question as we approved of them, things we wanted modified that it represented a substantial step forward from the protections that were in place before. we've also started a rulemaking to require standards to protect against geomagnetic disturbances that can be caused by solar storms and human actions. a real example of high impact low frequency threats to reliability that we need to get ready for before they happen. finally, i want to touch on the subject that congressman waxman raised, the physical security of the assets that make up the grid. protecting them from tampering, vandalism and sabotage. in general our approach in this

area has been based on cooperative efforts with industry and with other government agencies, dhs, fbi, dod and so forth, to try to develop best practices and communicating with industry to make sure their implement in those best practices. thank you very much for the opportunity to be here today, and i look forward to your questions on any aspects of the commission's work. thank you. >> thank you, ms. lafleur. and mr. moore, you are recognized by the. >> thank you, chairman whitfield, recommend, thank you for having us back. for this valuable oversight role that you undertake for the federal energy regulatory commission to i am a sitting commissioner and your staff asked us to focus on three areas in our test was today, and add additional items that we thought were relevant so i'll talk about the three items. pipeline citing, hydroelectric citing and add a couple more,

gas electric ordination and summer liability concerns on the electric grid. related to order 1000, i was generally supportive of order 1000 because i felt like it would add to the certainty to build need additional electric transmission in this country. and for the most part i think it's helped particularly with the transmission planning process. it's force a more open and arguably more accountable process. there were a couple of errors that i disagree with the majority want to the first was how we deal the right of first refusal projects. this isn't specific to reliability projects, not as economic projects that reduce congestion costs or the public policy projects that try and promote generally renewables through transmission, but rather when the utility is required because of nerc standards to build a project to enhance reliability. i would've preferred that we give a very limited time to write the first refusal to the incumbent utilities because i didn't think the litigation risk was worth it. and witnessing the litigation

out on that issue. hopefully that will be resolved soon. the secondary had to do with the cost allocation methods in the rule and a concern that because of the regional cost-sharing element of it, it would force utilities or give them the incentives to instead of building a regional projects, just go to local projects. and i think particularly in the midwest we've seen that happen. but for the most part we have several more years of order 1000 compliance ahead of us. we have further iterations of the entry regional filing and we haven't even tackled the interregional filings yet and those will be very complex with some major policy issues. order 1000 will be with us for a while. related to hide residing and pipeline citing, we have a lot of the same issues. ..

we've had a series of seven technical conferences. at the first five were regional and then we dug down to a series of issues on communications, whether people are comfortable talking to each other when there is a weather related to supply squeeze then we talked about the mismatch of the electric trading day and i'm happy to report we issue a final rule on the